Park prices have always been what they've been because those are the prices that were determined to make the owners money while still making the parks a compelling and cost-effective entertainment option. It's not like Six Flags has been selling brand-new $5,000 Beemers and taking a huge loss- the prices that they are charging are prices that worked for a long time. Because of that it's easy for some people to perceive wild price increases as greed, especially when the quality of the experience isn't marching forward in lockstep with the increases.
Add some immersive theming. Replace tired, lame steel coasters with state-of-the-art attractions. Landcape the hell out of the grounds. Install highly-paid, highly-trained employees. Bring in real dining options. Slap a coat of paint on everything that's visible to the guest. Then parks can charge tons of money and it'd be justified but right now I still say an expensive day at a regional theme park is like paying for the Hyundai with the BMW rims. ;)
Rob Ascough said:
I think Holiday World was in a position to raise prices as they added new rides and attractions but I think they're soon approaching the point when price increases have to either stop or at least slow down. I believe there's a point when people will accept price increases and a point when people will say that enough is enough. If Holiday World increases park admission by $5 for every major ride they add, it's not like people are going to be willing to pay $70 once another seven or eight rides are added.
Well, I believe people would pay that. :)
But you make an interesting point - one of diminishing returns. You're essentially saying that if HW doubled the size of the park that they couldn't ask twice what they are now. You might be on to something.
Once a park reaches a certain size/price, any additional growth can't be matched in price increase.
But what's a park to do? Remain stagnant? Cut costs to maintain margins?
HW always seems to be adding something and they bump the gate a buck or three each year depending on the addition. I'm assuming that is to cover the additional costs of running the ride in addition to building it and whatnot. The point is the price bump covers the cost and maintains profit margins.
So what happens when the park reaches the size that people won't accept the price bump? Something HAS to give. (and you can bet your bippy it's not going to be profit margins)
It's close to the whole well SFMM is better than CP issue. Like picking, geez this is bad... Britney over Agulera... I mean come on! Like picking the Beatles over the Stones... Mindbender over Shockwave... Whizzer over Zambezi... 'Gap' over 'Old Navy' (thank you American culture and brainwashing......)
We really can like it all... *** Edited 12/21/2007 4:05:59 AM UTC by J7G3***
You bring up a good point about the law of diminishing returns. Of course, you also have to keep in mind that operating expenses probably aren't going to keep increasing at the same rate for all eternity- sooner or later a park like Holiday World is going to find that expansion may become a little less expensive. Look at it this way:
A park builds its first wood coaster and needs to take care of the thing. The park builds a little maintenance shop, hires someone to run the thing and hires one or two people to assist him/her. As the park builds more wood coasters, it might need to expand that shop and hire more people but the shop is there and there's a manager in place so expenses aren't going to increase as much as they could. I realize that's an overly-simplified (and perhaps not very realistic) example of how an amusement park runs but I think it illustrates me point.
Seeing as how prices can't keep increasing ad naseum, parks have to find other ways to make money while maintaining profit margins (since I'll agree that's not something that's going to be cut.) I honestly don't know what the solution is. Create separate gates out of waterparks? Build retail and generate income through rent? Expand beyond rides and other generic amusement stuff? I'm not sure. All I know is that it's not realistic to keep hiking prices because there is a breaking point and people will simply move on to other forms of entertainment. It's not like the options aren't there.
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